Michigan Republican governor Snyder backs Medicaid expansion

(Reuters) - Michigan Governor Rick Snyder on Wednesday endorsed an expansion of health coverage for the poor under President Barack Obama's reform law, joining five other Republican governors who have agreed to widen the Medicaid program in their states.

Snyder made his announcement at a hospital in the state capitol of Lansing.

"This makes sense for the physical and fiscal health of Michigan," Snyder said in a statement.

He said the move will add 320,000 state residents in the first year, and more than 470,000 by 2021, cutting the number of Michigan uninsured almost in half.

Snyder joins fellow Republican Governor John Kasich of Ohio, who made his Medicaid expansion announcement on Monday. The Republican governors of Arizona, Nevada, New Mexico and North Dakota had previously said they would expand the program.

It also follows new assurances that the Obama administration will defend federal funding for the program in upcoming deficit reduction talks with Congress.

Snyder is expected to unveil his budget for fiscal 2014, including the Medicaid program changes, on Thursday.

Obama's Patient Protection and Affordable Care Act calls on states to expand Medicaid to most Americans earning up to 133 percent of the poverty line. The expansion would revolutionize the program, which in many states is now limited mainly to children, pregnant women and the very old. Under the reform law, Washington would fund more than 90 percent of the expansion.

Analysts say pressure on states from local healthcare industries, combined with a new Republican interest in appealing to minority voters in the wake of Obama's re-election, has nudged some governors toward acceptance.

Ron Pollack of Families USA, a Washington-based consumer healthcare advocacy group, said the decision by Michigan and Ohio's governors will provided health coverage to "well over a million uninsured people."

"It is also indicative of an inevitable movement that will ultimately result in Medicaid expansions in all states across the country," Pollack said.

The Medicaid expansion is intended to bring 16 million uninsured people into the $2.8 trillion U.S. healthcare system. But many states, which would pay less than 10 percent of the cost under the law, have balked at the potential budget impact or rejected the prospect of participating in a new government program.

Since Obama's re-election, at least 10 governors have chosen to support the Medicaid expansion, including six Republican governors. Five Republicans have chosen to oppose it.

Another 14 governors, 12 Republicans and two Democrats, remain undecided, but experts say many are likely to reach decisions in the coming weeks as they propose new budgets for the fiscal year beginning July 1.

Snyder was joined at the announcement by business, consumer and human service groups, including the Michigan Health & Hospital Association and the state's Small Business Association.

Snyder said more than $20 billion will come into Michigan through 2023 by leveraging federal funds made available through the Affordable Care Act, and that the state's General Fund will see $1.2 billion in savings through 2020.

"The bottom line is that expanding eligibility for coverage in the state's Medicaid Program will save lives, save money and lead to a healthier population," said Kim Sibilsky, executive director of the Michigan Primary Care Association.

Michigan House Speaker Jase Bolger, a Republican, said in a statement he remained "cautious and concerned" on behalf of taxpayers regarding the Medicaid expansion.

"The federal government has a history of working with states to start long-term programs while providing only short-term funding, and then sticking state taxpayers with the future financial liability that program creates," Bolger said.

(Reporting by Mary Wisniewski in Chicago; Editing by Greg McCune and Eric Walsh)

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